Governments Offer Housing Assistance
Families, particularly first-time home buyers, are increasingly unable to afford a home at current prices. The California Assn. of Realtors estimates that only 18% of Los Angeles County households can afford to purchase the county’s median-priced home, which cost about $205,000 in September.
For that 18%, affordability requires that a family earn at least $67,000 a year, can afford to pay 30% of their income toward their mortgage and can scrape together a down payment of about $41,000, association spokesman Jeff Hershberger said.
Because high home prices threaten to destroy the American dream of home ownership for many, government at all levels has debated stepping in. In the Nov. 6 election, voters had to decide on housing assistance plans that would use tax dollars. Potential sources of government help have included the following:
Federal Government: The Cranston-Gonzalez National Affordable Housing Act.
Status: Passed by both houses of Congress. President Bush has until the end of November to sign the legislation.
Amount of Money: $27.5 billion for fiscal 1991 and $29.9 billion for fiscal 1992.
Details: Creates a revolving loan fund to buy down interest rates for first-time home buyers who earn up to 95% of the median income where they live. Assists families in public housing to buy their units. The bill also provides for government-subsidized private apartments to remain affordable.
State Government: Proposition 145.
Status: Defeated Nov. 6 by California voters.
Amount of Money: $325 million in general-obligation bonds.
Details: Would have provided about $200 million to assist moderate-income, first-time home buyers. Plans for the remainder of the money included making affordable rental housing earthquake-safe and providing shelter and transitional housing for the homeless.
City Government: Proposition K, a bond issue in Los Angeles.
Status: Passed Nov. 6 by Los Angeles voters.
Amount of Money: $100 million in municipal bonds.
Details: Establishes a $10-million revolving fund to provide loans to first-time home buyers and allocates $10 million to create short-term, transitional housing for homeless families. The proposition also provides funds to make buildings earthquake-secure.
City Government: Redevelopment funds.
Status: Available now in many cities.
Amount of Money: At least $121 million in Los Angeles County, according to the Southern California Assn. of Governments.
Details: City redevelopment agencies are required to set aside a certain amount of their revenue to fund low- and moderate-income housing projects. Much of this money, which continues to accumulate, has never been used by city governments.
